markusovaevelyn706 markusovaevelyn706
  • 14-02-2020
  • Business
contestada

If 20 percent increase in the price of a good leads to a 60 percent decrease in the quantity demanded, then what is the price elasticity of demand?

Respuesta :

ewomazinoade ewomazinoade
  • 15-02-2020

Answer:

3

Demand is elastic

Explanation:

Elasticity of demand measures the responsiveness of quantity demanded to changes in price.

Elasticity of demand = percentage change in quantity demanded / percentage change in price

60 / 20 = 3

Demand is elastic because the coefficient of elasticity is greater than 3.

This means that a small change in price has a greater effect on the quantity demanded.

I hope my answer helps you

Answer Link

Otras preguntas

Convert 345 cm2 to the equivalent number of square feet (ft2)
Which of the following lines creates a natural pause by using a comma correctly? (5 points) "I, uh, am confused. Weren't we leaving at noon?" asked Carla.
PLEASE HELP MAJOR TEST List 15 important events about the story An Occurrence at Owl Creek Bridge
10. Complete the table below based on the following function:f(x)=-6x-1 X    Y ?    -1 -1    ? ?    -37 5     ?
119.31 is 82% of what number
how much would $500 invested at 6% interest compounded monthly be worth after 4 years?
Solve each question. round to the nearest tenth if necessary. 7r – 7 = 2r + 18
is the answer to 8+7+12÷3 2
Cells a and f show an early and a late stage of the same phase of mitosis. what phase is it
write an equation of direct variation that includes the point (9,-12)